Fukushima Floating Offshore Wind Project Seeks to Halve Cost

By Chisaki Watanabe -
Nov 28, 2013

Operators of a wind farm in waters
off Fukushima prefecture, site of the March 2011 nuclear
disaster, aim to cut the cost of setting up the floating
turbines by half as they push to commercialize the technology.

The pilot project, funded by the government and led by
trading house Marubeni Corp. (8002), began operations on Nov. 11 with a
2-megawatt turbine connected to a substation. Both are about 20
kilometers (12 miles) off the coast of Fukushima. The project’s
second phase will see the installation of two more turbines from
Mitsubishi Heavy Industries Ltd. (7011) with 7 megawatts capacity each.

“The most important thing for the first phase was to float
the turbine and make it work, rather than the cost,” Tomofumi
Fukuda, a Marubeni official, said earlier this month in
Fukushima after a ceremony to mark the start of operations.
“For the second phase, it will become very important to figure
out how to reduce costs to commercialize the technology.”

The effort off Fukushima is part of a broader push by Japan
to diversify its sources of energy after the nuclear disaster in
2011 and the subsequent idling of the nation’s fleet of atomic
power stations for safety checks. Prime Minister Shinzo Abe’s
Cabinet has set a target of making floating offshore wind
technology viable by 2018.

Manufacturing and installing the 2-megawatt wind power
generation system, which is able to generate power for about
1,700 homes, cost slightly more than 2 million yen ($20,000) per
kilowatt, Fukuda said. Operators want to reduce that to 1
million yen per kilowatt by the second phase when the next two
turbines are installed, he said.

Cost Considerations

Costs would need to drop to 700,000 yen per kilowatt to
800,000 yen per kilowatt for floating offshore wind farms to be
more commercially viable, according to the Marubeni official.

At that level, they would become competitive with offshore
wind projects that use monopile foundations to fix turbines to
the ocean floor, Justin Wu, Bloomberg New Energy Finance’s head
of wind analysis, said.

The goal is to eventually cut the cost to 500,000 yen per
kilowatt for a project with a capacity factor, or how often a
generator runs during a certain period of time, of 40 percent,
according to Fukuda. Onshore wind projects typically operate at
250,000 yen per kilowatt and a capacity factor of 20 percent, he
said.

“It cost us more than we’d anticipated to set up the
station,” Keisuke Murakami, an official in charge of the
program at the Ministry of Economy, Trade and Industry, said.

Floating Turbines

Costs for the project escalated partly because of seas
conditions and high waves from a typhoon that prevented workers
from reaching the site.

The 2018 target for Japan is “challenging,” BNEF’s Wu
said. “The real cost cutting comes from doing a lot of it,” he
said.

Regardless of those hurdles, the project’s backers say
Japan has good reason to push the development of floating
offshore wind farms. Floating turbines can operate in deep
waters such as those surrounding Japan’s 35,000 kilometers of
coastline, the sixth longest in the world. Bottom-fixed turbines
are more suited for shallower waters where foundations are
installed directly to the seabed.

Japan has 1,383 gigawatts of available offshore wind
energy, compared with 268 gigawatts onshore, according to
estimates by the Ministry of the Environment.

Development of floating offshore technology would benefit
turbine makers such as Mitsubishi Heavy and Hitachi Ltd. (6501), as
well as engineering companies such as Nippon Steel & Sumikin
Engineering Co.

Budget Plan

The government has committed 22 billion yen to the five-year project, surpassing the original budget of 18.8 billion
yen. For the fiscal year starting April 1, the trade ministry is
requesting 31 billion yen.

The additional budget, pending approval, would be used to
install the two turbines, said Murakami. The ministry also wants
to try out different types of technologies for turbines,
floating structures and other components to find cheaper
alternatives, he said.

The trade ministry has said the Fukushima project may be
extended to 1,000 megawatts. Operators will need to get approval
from local fishermen to commercialize the project.

“Fukushima’s image has been tarnished since March 11,”
said Yuichi Manome, a fisherman from Iwaki City. “By doing this
project, the first of its kind in the world, we can show the
world a different Fukushima.”

To install more turbines, Japan would need more
construction vessels, Fukuda said. Currently, Japan’s capacity
would be limited to installing five units a year, he said.